Branch vs Subsidiary: Registering a Foreign Company in Dubai
A foreign company entering Dubai faces one structural decision before it files a single form: does it register a branch of the existing company, or incorporate a separate subsidiary. The two look similar from the outside — both let the parent trade in the UAE — but they sit on opposite sides of a legal line. A branch is the same legal person as the parent, wearing a UAE licence; a subsidiary is a new company the parent owns. That single distinction ripples through liability, permitted activities, corporate tax and, very practically, the pile of parent-company documents you must attest and translate into Arabic. This guide sets out the difference, gives you a side-by-side decision table, and lists exactly which parent documents need attestation and certified legal translation. It is general information to help you plan, not legal or tax advice on your matter; the Ministry of Economy, Dubai's DET and the Federal Tax Authority set the binding requirements.
- A branch is not a separate legal entity — the parent carries full liability for it
- A foreign branch is registered with the Ministry of Economy, then licensed by the emirate authority
- A subsidiary is a new UAE company with its own legal personality and limited liability
- Either route needs parent documents attested and translated into Arabic by a licensed legal translator
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Branch or subsidiary, in one paragraph
Choose a branch when you want the foreign parent to operate directly in Dubai under its own name and legal identity, and you accept that the parent is fully and directly liable for what the branch does. Choose a subsidiary when you want a separate UAE company — its own legal personality, its own limited liability, its own local corporate identity — that the parent owns as a shareholder. A branch is registered federally with the Ministry of Economy and then licensed by Dubai's Department of Economy and Tourism; its activities must stay within what the parent itself does. A subsidiary is incorporated as a new UAE entity and can, for most activities, be wholly foreign-owned since the 2021 reforms. Both paths require the parent's corporate documents to be attested through the legalisation chain and translated into Arabic by a Ministry of Justice-licensed legal translator before they will be accepted.
The rest of this guide unpacks each factor — legal personality, ownership, permitted activities, liability, corporate tax grouping and the federal registration step — and then walks through the parent documents you will have to prepare either way. If you read nothing else, read the decision table further down: it is the fastest way to see which structure matches your risk appetite and your plans.
A branch is an extension; a subsidiary is a new company
Under Federal Decree-Law No. 32 of 2021 on Commercial Companies, a foreign company that wants to carry on business in the UAE through a branch or representative office must be licensed by the Ministry of Economy — after the competent authority in the emirate has approved — and entered in the commercial register. The branch is treated as an extension of the foreign company itself: it has no separate legal personality, and the parent stands behind its obligations. That is the defining feature, and everything else follows from it.
A subsidiary is a different animal. It is a UAE company that you incorporate — typically a limited liability company — which the foreign parent then owns as shareholder. It has its own legal personality, so it contracts in its own name, it sues and is sued in its own name, and, as a rule, its liability is confined to the company rather than reaching up to the parent. Since the 2021 ownership reforms, most commercial and industrial activities allow full foreign ownership of that UAE company, so a foreign group can often own 100% of its Dubai subsidiary without an Emirati partner.
There is also a third, narrower form worth naming: a representative office. It is not a trading vehicle — it may promote and market the parent and act as a liaison, but it cannot conduct commercial operations or generate revenue in the UAE. If your aim is to actually do business in Dubai, the real choice is branch versus subsidiary; the representative office is for presence without trade.
The words that decide the structure
- Branch of a foreign company
- A UAE-licensed presence of an existing foreign company, with no separate legal personality. It conducts the parent's activities, and the parent is directly liable for it.
- Subsidiary
- A separately incorporated UAE company owned by the parent. It has its own legal personality and, generally, limited liability confined to the company.
- Representative office
- A liaison and marketing presence for the parent. It may promote the parent but cannot trade or earn revenue in the UAE.
- Ministry of Economy registration
- The federal step for a foreign branch: the Ministry of Economy licenses and registers the branch of the foreign company, in addition to the emirate-level licence.
- Permanent establishment
- A corporate-tax concept: a fixed place of business through which a non-resident operates. A foreign company's UAE branch is typically treated this way for tax.
Branch vs subsidiary, factor by factor
| Factor | Branch of foreign company | Subsidiary (UAE company) |
|---|---|---|
| Legal personality | None of its own — an extension of the parent, which contracts through it. | Separate legal person, distinct from the parent shareholder. |
| Ownership | Wholly the parent's by definition; no local service agent required after the 2021 reforms. | Owned by shareholders; most activities allow 100% foreign ownership since 2021. |
| Permitted activities | Must fall within the parent's own activities; the branch cannot do more than the parent. | Can be licensed for its own activities, independent of the parent's scope. |
| Liability | The parent is directly and fully liable for the branch's obligations. | Liability is generally confined to the company; the parent risks its capital, not more. |
| Corporate tax grouping | Treated as an extension of the head office, not a separate juridical person — cannot form a UAE tax group in its own right. | A resident juridical person that may join or form a tax group with related UAE companies, subject to the conditions in the Corporate Tax Law. |
| Federal Ministry of Economy step | Required — the branch is registered and licensed by the Ministry of Economy in addition to the emirate licence. | Not a separate foreign-branch registration; the company is incorporated and licensed at the emirate level. |
Parent-company documents to attest and translate into Arabic
- Board resolution of the parent approving the Dubai branch or subsidiary and appointing the manager — attested and Arabic-translated
- Certificate of incorporation of the parent company — attested through the full legalisation chain and translated
- Memorandum and articles of association of the parent — attested and Arabic-translated
- Power of attorney appointing the UAE branch or company manager — attested and translated
- A certificate of good standing and, where required, recent audited financial statements of the parent
- Passport copies of the parent's authorised signatories and the appointed manager
- Every foreign document notarised at home, attested by the home Ministry of Foreign Affairs and the UAE Embassy, then attested by the UAE Ministry of Foreign Affairs on arrival
- Arabic translation of each attested document by a Ministry of Justice-licensed legal translator — uncertified translation is a common rejection cause
Have a question about your case?
How a foreign branch is registered in Dubai
Fix the activity and name
Confirm the branch activity falls within the parent's own scope and reserve the trade name through Dubai's Department of Economy and Tourism.
Prepare and attest parent documents
Assemble the board resolution, certificate of incorporation, MOA/AOA and power of attorney, put each through the legalisation chain, then translate into Arabic through a licensed legal translator.
Initial approvals
Obtain the emirate authority's approval and any activity-specific approvals from the competent regulator.
Ministry of Economy registration
Register the branch of the foreign company with the Ministry of Economy through its electronic platform, as required for foreign branches and representative offices.
Emirate licence and registry
Complete the DET licence and entry in the commercial register, then arrange the establishment card, premises and bank account.
Deciding between a Dubai branch and a subsidiary, and need the parent's documents attested and translated correctly the first time? Tell us the parent company, the activity and your risk appetite.
Explore corporate servicesWhich structure fits which situation
A consultancy wants a Dubai presence doing exactly what the parent does.
What is usually neededA branch fits — same activity, same brand, direct extension of the parent, with the parent accepting liability.
A group wants to ring-fence UAE risk from the parent balance sheet.
What is usually neededA subsidiary fits — separate legal personality and limited liability keep UAE exposure inside the local company.
A parent wants the Dubai entity to offer activities it does not itself hold.
What is usually neededA subsidiary fits — it can be licensed for its own activities, whereas a branch is confined to the parent's scope.
The Dubai entity should sit inside a UAE corporate tax group.
What is usually neededA subsidiary fits — a resident juridical person can, subject to conditions, group with related UAE companies; a branch as an extension of the head office cannot form a group in its own right.
Mistakes that stall a foreign-company registration
The mistakeAssuming a branch shields the parent from liability the way a subsidiary would.
The fixRemember the branch has no separate legal personality; the parent is directly liable. If liability isolation matters, incorporate a subsidiary.
The mistakeTrying to license branch activities the parent company itself does not carry on.
The fixKeep the branch within the parent's scope, or choose a subsidiary that can hold its own activity licence.
The mistakeTranslating parent documents before they are fully attested, or using an unlicensed translator.
The fixComplete the legalisation chain first, then translate into Arabic through a Ministry of Justice-licensed legal translator whose certification is recognised.
The mistakeBudgeting or quoting a bank guarantee that is no longer required.
The fixThe AED 50,000 bank guarantee for foreign branches was removed by Ministerial Resolution No. 138 of 2024; confirm current requirements with the Ministry of Economy rather than relying on older guides.
The mistakeOverlooking the federal Ministry of Economy step and assuming an emirate licence is enough for a foreign branch.
The fixA foreign branch is registered with the Ministry of Economy in addition to the DET licence; plan for both.
Requirements are set by the authorities and change over time
This guide describes the shape of the branch-versus-subsidiary decision and the documents each route needs. The binding rules come from Federal Decree-Law No. 32 of 2021, the Ministry of Economy's current resolutions on foreign branches, Dubai's Department of Economy and Tourism, and — for tax — the Federal Tax Authority under Federal Decree-Law No. 47 of 2022. Fees, thresholds and document lists are updated periodically, so confirm the current position with the relevant authority before you file.
Corporate tax treatment in particular depends on your specific structure and facts. Whether a subsidiary can join a tax group, and how a branch is taxed as a permanent establishment, are questions for a qualified tax adviser and the Federal Tax Authority's guidance, not for a general article.
Branch vs subsidiary: common questions
A branch is the same legal person as the foreign parent, operating in Dubai under a UAE licence; it has no separate legal personality and the parent is fully liable for it. A subsidiary is a new UAE company that the parent owns as a shareholder, with its own legal personality and, as a rule, limited liability. In short, a branch extends the parent while a subsidiary is a distinct company. Which fits depends on whether you want to ring-fence liability and license independent activities (subsidiary) or operate directly under the parent's identity (branch).
Yes. A branch is, by definition, wholly the foreign parent's — it is the parent operating in Dubai, not a company owned by others. Since the 2021 reforms, a foreign branch no longer needs a local service agent for most activities. Separately, a subsidiary can also be 100% foreign-owned for the majority of commercial and industrial activities under the updated ownership rules, though certain strategic activities can still carry conditions.
Yes. Under Federal Decree-Law No. 32 of 2021, a foreign company operating through a branch or representative office must be licensed and registered with the Ministry of Economy — after the competent emirate authority approves — in addition to the emirate-level licence from Dubai's Department of Economy and Tourism. This federal registration is a distinctive step of the branch route that a purely local subsidiary does not go through in the same way.
At minimum the parent's board resolution approving the Dubai entity, its certificate of incorporation, its memorandum and articles of association, and the power of attorney appointing the manager — often with a certificate of good standing and audited financials. Each foreign document goes through the legalisation chain (home notarisation, home Ministry of Foreign Affairs, the UAE Embassy, then the UAE Ministry of Foreign Affairs) and is then translated into Arabic by a Ministry of Justice-licensed legal translator. Uncertified translation is a frequent reason applications are rejected.
As a rule, no. A branch is an extension of the parent, so its licensed activities must fall within what the parent company itself carries on; it cannot do more than the parent. If you need the Dubai entity to offer activities the parent does not hold, a subsidiary is the better fit, because a separately incorporated UAE company can be licensed for its own activities independent of the parent's scope.
Generally not in its own right. For UAE corporate tax, a branch is treated as an extension of its head office rather than a separate juridical person, and a tax group is formed by resident juridical persons that meet the conditions in the Corporate Tax Law (Federal Decree-Law No. 47 of 2022). A subsidiary — a resident UAE company — can, subject to those conditions, form or join a tax group with related companies. Because tax outcomes turn on your specific facts, confirm the position with a qualified tax adviser and the Federal Tax Authority's guidance.
Official sources
- Federal Decree-Law No. 32 of 2021 on Commercial Companies (Ministry of Economy & Tourism, full text)
- Ministry of Economy & Tourism — Register branch of a foreign establishment
- UAE Legislation portal — Federal Decree-Law on Commercial Companies
- u.ae — Full foreign ownership of commercial companies
- Federal Tax Authority — Federal Decree-Law No. 47 of 2022 on the Taxation of Corporations and Businesses
This content is for general awareness and is based on the official sources available at the time of the last update. Company-formation and corporate-service requirements, fees, approvals and steps differ by the business activity, the legal form and the jurisdiction, and are set and updated by the competent authorities. It is not legal or financial advice. MANJAZ is a corporate-services provider that helps prepare, coordinate and follow up requirements with the relevant authorities — it is not the Department of Economy and Tourism or any government body, it does not issue trade licences, it cannot approve a business activity, and it does not guarantee any approval.
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